The next new trade in our Paid-to-Play portfolio is:

Today’s Hot List is a short one.

Patrick S. Barrett, executive vice-president and CFO of OceanFirst Financial Corp $OCFC, revealed a purchase of approximately 10,500 shares in his own stock.

From the desk of Louis Sykes @haumicharts

One of the great features of technical analysis and classical charting is its universal nature.

Technical analysis is a proven value-add regardless of which asset class you're analyzing, be it equities, commodities, bonds, or even the emerging world of digital assets.

Markets are incredibly sophisticated, with many moving parts. A big misconception about technical analysis held by novice proponents is that fundamentals are of no use.

It's quite the opposite. Fundamentals drive markets.

Particularly when it comes down to long time frames, markets are driven by fundamentals and macroeconomic factors.

On the other hand, technicals help us profit in the direction of those fundamentals. 

Over shorter time frames, markets are driven by speculation and significant players. As a result, technicals and order flow are important to emphasize over these time frames.

Under these conditions, smart players with a lot of size push prices to maximum pain thresholds of the so-called "dumb money."

Many times, you'll see this manifest in...

From the desk of Ian Culley @IanCulley

In almost every market environment, there are assets we want to buy and assets we want to sell. That holds even when we think the only option is to sell.

Recently, the strong buys have been in commodities and cyclical areas of the market, while bonds and the major stock indexes have sold off. That's dramatically changed in recent weeks, though.

Now, all the major asset classes –  bonds, stocks, and commodities – are under pressure, as bears come for the leadership groups. It seems nothing is immune to bearish price action these days. 

Despite the broad selling pressure, there's still an asset we want to buy: the US dollar. That’s right, the good old greenback! It’s one thing the bears can’t seem to crack.

If we think about it from an intermarket perspective, a defensive bid for dollars makes sense given the downside pressure on risk assets across the board. We don’t think it’s a coincidence.

Regardless, the USD is strong and shows no signs of changing anytime soon. 

Last week,...

From the desk of Willie Delwiche.

Identifying recessions is an academic exercise for historians. It usually requires the passage of time to gain the necessary perspective. The December 2007 business cycle peak was not identified as such (by the NBER) until December 2008. While June 2009 would eventually be identified as the business cycle trough, NBER did not make this determination until September 2010.

For those allocating capital in real-time, this becomes more than just an academic discussion. Whether the economy is in recession or not can impact the length and severity of bear markets. Bear markets that occur independent of recession tend to last 7 months, with an average peak-to-trough drawdown of 23%. If there is a recession involved, bear markets tend to last for well over a year and the average pullback is 33%. The recession question was a hotly debated topic in early 2008 and there are certainly echoes of those conversations now. 

The Fed and other central banks are still aggressively raising rates even as growth slows dramatically. Manufacturing and New Orders indexes from the Richmond Fed (showing...

We've adjusted a position in the Paid-to-Play portfolio today:

The largest insider buy on today’s list is yet another Form 4 filing by Warren Buffett’s Berkshire Hathaway $BRK.A.

Buffett just revealed an additional purchase in Occidental Petroleum $OXY, as he continues to build his position in the energy stock.

These are the registration details for our Live Monthly Candlestick Strategy Session for Premium Members of All Star Charts.

This month’s Video Conference Call will be held on Tuesday July 5th @ 6PM ET. As always, if you cannot make the call live, the video and slides will be archived and published here along with every other live call since 2015.

Here are the details for Tuesday evening:

Is the market out of the woods yet? No.

Is there a change in trend with the most recent bounce bank in the indices? No.

Are some areas of the market doing better than others? Yes.

Are we here to discuss one such sector today? You bet we are!

We've been pounding the table about the strength that we've been noticing in the Auto space for over a month now. With that trend becoming more and more clear, we have a few more names joining the leaders. The Auto sector is exhibiting strengths that cannot and should not be ignored. Read on to know more!

First up, let's take a look at the index chart and focus on the levels here. 10,400 has acted as a crucial zone of support during the past five months of whipsaw moves in the market. The index continued to hold on to these levels even as other sectors were giving up on their floors without a fight. That was our first sign of relative strength.

The index has since bounced back and is currently trading close to 11,580. The next level to track here is the 2018 high level near 12,130. It will be quite interesting to see how the price...

From the desk of Steve Strazza @sstrazza

This is one of our favorite bottom-up scans: Follow the Flow. In this note, we simply create a universe of stocks that experienced the most unusual options activity — either bullish or bearish, but not both.

We utilize options experts, both internally and through our partnership with The TradeXchange. Then, we dig through the level 2 details and do all the work upfront for our clients.

Our goal is to isolate only those options market splashes that represent levered and high-conviction, directional bets.

We also weed out hedging activity and ensure there are no offsetting trades that either neutralize or cap the risk on these unusual options trades.

What remains is a list of stocks that large financial institutions are putting big money behind.

And they're doing so for one reason only: because they think the stock is about to move in their...

Key Takeaway:

• Indicators suggest echoes of Financial Crisis.
• Looking for signs of strength, not just absence of weakness.
• Burden of proof is on the bulls to show that strength can persist.

At this point, we cannot know whether the current environment will ultimately end up bearing more than a passing resemblance to the 2008/09 financial crisis. There are, however, enough similarities between now and then that the comparison is worth considering.

Consider what we are seeing from a price perspective and across a handful of other indicators:

Price: Failed rallies have been followed by lower lows on the S&P 500 since the index peaked in January of this year. A similar pattern developed following the market peak in October 2007. The damage done to a 60-40 passive portfolio has been greater this year than at a similar post-peak point during the financial crisis, but it’s perhaps not a coincidence that prior to this year, the only time in the past quarter century that both stocks and bonds were underwater in back-to-back quarters was...

From the desk of Steve Strazza @Sstrazza.

Welcome back to our latest Under the Hood column, where we'll cover all the action for the week ended June 24, 2022. This report is published bi-weekly and rotated with our Minor Leaguers column.

What we do here is analyze the most popular stocks during the week and find opportunities to either join in and ride these momentum names higher, or fade the crowd and bet against them.

We use a variety of sources to generate the list of most popular names.

There are so many new data sources available that all we need to do is organize and curate them in a way that shows us exactly what we want: a list of stocks that are seeing an unusual increase in investor interest.

Watch this video for a behind-the-scenes look at our process.

Whether we’re measuring increasing interest based on large...

From the desk of Steve Strazza @Sstrazza

Our Top 10 Charts Report was just published.

In this weekly note, we highlight 10 of the most important charts or themes we're currently seeing in asset classes around the world.

Risk Assets Holding on by a Thread

Risk assets have been under consistent selling pressure for some time now. The Russell 2000 and Bitcoin are both excellent examples of the damage that’s already taken place. Both are holding on by a thread at crucial support levels. As you can see in the chart, for Bitcoin, the 2017 highs around $20,000 are the level we're watching. For small-cap stocks, the line in the sand is at the 2018 and 2020 highs around 171. 

If the Russell 2000 and Bitcoin continue to hold these key levels, things are likely improving for stocks and cryptos more broadly. However, if they violate their respective support levels, we have to anticipate increased volatility and another leg lower for risk assets.

From the desk of Steve Strazza @Sstrazza

Check out this week's Momentum Report, our weekly summation of all the major indexes at a Macro, International, Sector, and Industry Group level.

By analyzing the short-term data in these reports, we get a more tactical view of the current state of markets. This information then helps us put near-term developments into the big picture context and provides insights regarding the structural trends at play.

Let's jump right into it with some of the major takeaways from this week's report:

* ASC Plus Members can access the Momentum Report by clicking the link at the bottom of this post.

Macro Universe:

• This week, our macro universe rebounded as 74% of our list closed higher with a median return of 1.65%.
• Russell 1000 Growth $IWF was the winner, closing with an 8.15% gain.
• The biggest loser was the Volatility Index $VIX, with a weekly loss of -12.53%.
• There was a 2% drop in the percentage of assets on our list within 5% of their 52-week highs – currently at 2%.
• 0% of our macro list made fresh 4-week highs.
...

I'll cut right to the chase: JC put out a piece this morning highlighting the relative outperformance of the Healthcare space.

The XLV sector ETF for the space has more or less been consolidating sideways as the broader markets sold off, and one of the bellwethers here is already making new all-time highs. Feels like we'll start to see more candidates here begin to participate as well.

So let's get right to it!

Last week's letter addressed the asymmetric opportunity being presented to long-term crypto investors.

By most measures, the crypto capital markets are in extreme oversold conditions. Using on-chain data, we demonstrated how Bitcoin market participants are closely approaching their maximum pain thresholds.

For long-term holders, periods such as these represent advantageous places to more aggressively average into spot positions.

Over this time frame, we strongly believe that we'll look upon this period as a great time to have accumulated Bitcoin and other major cryptocurrencies.

But this raises yet another question: What does the short-term outlook look like?

As any technical analyst would be quick to announce, long-duration assets and cryptocurrencies have been in an assertive downtrend as central banks have moved into a tightening regime following inflationary pressures.

But these bear markets often see swift and aggressive counter-trend rallies.

For short-term active traders, these moves are a nice way to capture a quick buck provided you're nimble in your profit-...

The next new trade in our Paid-to-Play portfolio is:

We had a resting GTC order filled to close a position in the Paid-to-Play portfolio today:

Last week the US Healthcare Sector hit new multi-year highs relative to the S&P500.

The Relative Strength has already been there under the surface.

And when you look at Healthcare on an absolute basis you can see the sideways digestion of prior gains during a period where most stocks and indexes were falling:

The largest insider transaction on today’s list is a Form 4 filing by Nimish P. Shah, who reported a purchase of roughly $5.1 million of Tricida $TCDA.

Thomas Meth, the president of Enviva $EVA, reported a purchase of 8,600 shares, equivalent to $505,508 worth of stock.